Posted on 11 Nov 2011
Workforces worldwide are reaching their tipping point as employee satisfaction, or engagement, continues to be sluggish and remains at the lowest level since 2008, according to analysis recently released by Aon Hewitt, the global human resource consulting and outsourcing business of Aon Corporation.
At the end of the third quarter, Aon Hewitt analyzed its Employee Engagement Database of more than 5,700 employers, representing five million employees worldwide. The findings reveal an engagement level of 56 percent thus far in 2011, which is the same as 2010, but lower than 2009 (60 percent) and 2008 (57 percent). Traditionally, engagement levels between 65 percent and 100 percent represent a high-performing culture; 45 percent to 65 percent indicate the workforce is indifferent to organizational success or failure; and anything lower than 45 percent represents a serious or destructive range.
According to Aon Hewitt, the largest drop in engagement this year is employees' perception of how companies manage performance. Workers worldwide believe their employers have not provided the appropriate focus or level of management that would lead to increased productivity, nor have they connected individual performance to organizational goals.
"A significant number of employees are not motivated enough to provide extra effort beyond the job requirements and many anticipate leaving their employers in the near future," said Pete Sanborn, Talent and Organization Consulting global practice leader for Aon Hewitt. "This is critical, as our research continues to show a strong correlation between employee engagement and financial performance, even in turbulent financial times. For example, in 2010, organizations with engagement levels of 65 percent or greater outperformed the total stock market index and posted total shareholder returns 22 percent higher than average. On the other hand, companies with engagement of 45 percent or less had a total shareholder return that was 28 percent lower than the average return in 2010."
Aon Hewitt further analyzed this 2011 data and measured satisfaction scores for key drives of engagement, with its benchmark database. This revealed that Managing Performance (the way we manage performance here keeps me focused on achieving this organization's goals) dropped nearly 8 percentage points globally thus far in 2011, with a global satisfaction score of 44 percent. Regionally, Managing Performance in Latin America is at 55 percent, followed by the U.S. (50 percent), Canada (49 percent), Asia Pacific (49 percent) and Europe (36 percent).
Engagement scores connected to Managing Performance also are low. For example, Career Opportunities (my career opportunities here look good) has a 42 percent global satisfaction level, Recognition (appropriate recognition beyond pay and benefits for an employee's contribution) is at 40 percent globally, Tools & Resources (contribution of tools and resources toward employee productivity) is at 51 percent worldwide, while Senior Leadership (evidence of effective leadership from senior leaders) has a score of 48 percent globally.
"Our analysis suggests that even at the height of the recession, employees felt a greater connection to their work and role in achieving organizational success than they do now," said Sanborn. "This is a harsh reality, but also an opportunity for those employers willing to invest in specific areas that will have the largest impact on employee engagement. While there is an expense in doing so, the return on investment can be well worth the effort."